Starbucks’ paid US owners 15 times more in dividends than it did in UK tax

Starbucks’ UK arms last year paid their US owner 15 times more than the British taxman.

Its seven businesses here coughed up just £22.5million corporation tax compared to the £353million dividend it handed its parent company.

The windfall for the Starbucks Corporation was up from £47million in 2017 after tax reforms introduced by Donald Trump to encourage US multi-nationals to repatriate profits.

Margaret Hodge, ex-chairwoman of the Commons’ Public Accounts Committee, said: “When ordinary families are struggling, it sticks in the gullet that people like Starbucks won’t pay their fair share.

“It operates an opaque financial structure which has no other purpose than to avoid tax.”

The Starbucks Corporation has a stock market value of nearly £80billion.

Newly published accounts of Starbucks EMEA, which collects royalties from franchisees in various countries, show it paid £15million UK corporation tax last year on profits of £200million – a rate of just 7.5%. The standard rate is 19%.

Starbucks EMEA says it pays less because profits from its Dutch arm have already been taxed there. Five of Starbucks’ other UK- based businesses with dealings abroad paid £3.5million. And Starbucks UK Coffee Company, which oversees 1,000 own and franchisee-run stores, paid £4million.

George Turner of the Taxwatch consumer group slam­med “secrecy” around the Dutch dividends.

He said: “The firm says these have been sub­­­ject to tax overseas but how much and where is far from clear. It is possible the large profits declared in the UK have not been subject to much tax at all. The company have provided few details of payments outside the UK.”

Martin Brok, president of Starbucks Europe, Middle East and Africa, said business had been “challenging”.

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